MGBBT0UBN Understanding Business Organisation: Premier Inn Case Study

This case study analyses the business organisation of Premier Inn, a leading UK hotel chain, focusing on its hierarchical organisational structure and the benefits and drawbacks of this model. It explores the internal and external factors impacting the hotel, particularly through SWOT and PESTLE analyses, highlighting the effects of COVID-19 on the hospitality industry. The study examines Premier Inn's strengths, weaknesses, opportunities, and threats, as well as political, economic, social, technological, legal, and environmental factors influencing its operations. The analysis reveals the importance of adapting to changing market conditions, leveraging digital platforms, and maintaining safety standards to ensure business continuity and growth in the face of challenges like the COVID-19 pandemic. The report concludes that effective organisational structure and environmental analysis are crucial for achieving organisational objectives and mitigating risks.

Understanding
Business Organisation

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Organisational structure of Premier Inn Hotel............................................................................3
Internal and External factors which impact on Premier Inn.......................................................4
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business organization assist in determining structure of firms which they execute to
accomplish specific goals and targets. Managing business properly helps in organising various
departments within a company effectively and enhance productivity of employees. The following
report consist of organizational structure implemented by Premier Inn hotels to accomplish its
desired organizational objectives (Henley, 2018). The report also explains why the particular
organization implement chosen organizational structure and how it is beneficial for it along with
its drawbacks. Furthermore, macro and micro environmental factors of the particular company
which have been impacted during COVID-19 are explained by implementing SWOT and
PESTLE analysis. Premier Inn hotel is UK’s largest hotel brand and was founded in 1987 by
white bird. The respective hotel contains approximately 72,000 rooms as well as 800 hotels. The
selected hotel has its headquarter in Dunstable, UK along with operating its business functions in
various other countries.
MAIN BODY
Organisational structure of Premier Inn Hotel
Organizational structure is an approach that determines how information conveyed within an
organization between different departments. It also determines how specific activities are taking
place within a company to accomplish its target goals. In context of Premier Inn hotel, it
implements hierarchical organizational structure which is described as a chain of command from
superior authority and administrator to general (Teräs, 2021). Senior authorities of the company
monitor the performance of employees beneath them and take all essential decisions which are
then conveyed through subordinated levels of management.
Senior management of hotel contains owners and executive managers who execute specific
policies and direct general manager of to organise everyday activities within a company. The
general manager also monitors activities of various departments such as housekeeping, laundry,
for food and beverages. Mid level department of selected hotel includes front desk officer,
housekeeping department and food and beverages department.
Benefits of hierarchical organizational structure
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 This structure helps in developing a clear defined system for conveying clear information
among the employees show that activities could be accomplished effectively. The
supervising officer get their orders from senior managers. This procedure of information
circulation makes it easy for the respective hotel to execute their business strategies
efficiently.
 This hierarchical structure also assists in clearing all the responsibilities and roles of
employees within respective hotel as well as make it easier for managers to operate the
business effectively (Miles, Belousova and Chichkanov, 2018). There is no confusion
among employees as roles of every employee is clear which minimize chance of conflicts
and misunderstandings.
Drawbacks of hierarchical organisational structure
 Different departments within a company perform their duty according to their way which
isolates them from other section of hotel and reduce interdepartmental communication.
This also leads to miscommunication and conflicts between employees from different
departments.
 Division of workers in specific department could lead to rivalry among them in order to
accomplish desire targets that could benefit their division only (De Stefano and Aloisi,
2019). This could harm the image of company as people might develop hate for each
other in order to become more powerful then another department which impact their
productivity.
Internal and External factors which impact on Premier Inn
SWOT analysis of Premier Inn
SWOT analysis assist in identifying strength, weaknesses, opportunities and threats that
organization could experience in the market while operating their business functions. By
implementing SWOT analysis Premier Inn could evaluate the benefits it could have and reduce
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chances of failures. SWOT analysis of Premier Inn has been explained below
Strengths Weaknesses
 The respective hotel is most profitable
hotels in UK. In the year 2017, the
profit which the company gained it was
approximately by 7.4% 2 about for
€468 million. It also contains residency
rate of around 80% (SWOT analysis of
Premier Inn, 2018).
 The respective hotel has also created a
strong brand image in the country
which helps in providing welcoming
environment it’s potential customers. In
the year 2017 it has voted as ‘Best UK
economy hotel brand’ at British Travel
Awards.
 The respective hotel also possess
limited global presence and operates its
business functions in few countries
such as United Arab Emirates, Republic
of Ireland and UK.
 It also contains limited market share or
small margin because of high
competition in the market. The hotel
faces intense competition from various
hotels such as Easyhotel, Holiday Inn
and others.
Opportunities Threats
 Many companies are shifting their
business activities on digital platform
which could be used by select hotel as
an opportunity to attract more
customers and enhance its
productivity. The company could
provide booking facility to customers
on online sites.
 Usually travellers across world seek
for new destinations to explore various
places which could also be use by
 Because of COVID-19, hospitality
industry has seen decline in tourist
activities which could become threat
for respective hotel. This pandemic
has decreased its growth and
profitability due to lock-down
restrictions.
 Various competitors in the market
such as Ibis, Badison and others also
impact market share the respective
hotel.
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hotel as an opportunity to expand its
branches in other nations and new
market.
Pestle analysis of Premier Inn
This is a marketing model which help in evaluating external environmental factors of hospitality
industry in which Premier Inn operates its business operations. Due to COVID-19, it has become
very important for the selected company to regularly evaluate its macro environmental factors in
order to exploit opportunities and to reduce threats.
Political factors:
In the UK, Premier Inn has a strong brand image which helps it in enhancing its customer base
along offering various offers for them. The government of the UK has announced a scheme for
hospitality industry which is called as “Eat out to help out” during COVID-19 (Butler and
O’Brien, 2019). This scheme has provided positive opportunity for selected hotel and it has made
sure that all precautionary measures have been followed.
Economic factors:
The economic situation of the UK has been greatly influenced during COVID-19 because the
country has seen a high decline in GDP and employment rate. The reduction in disposable
income of citizens further minimised sales and revenue of hospitality industry. The economic
component had highly impacted Premier inn hotel in negative way because it has to maintain
expenses of hotel which are very high. As after COVID-19 it has become difficult for people to
travel and spend their income on hotels which resulted in low sales of respective hotel.
Social factors:
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After COVID-19, the hospitality industry has seen a drastic change in behaviour of customers as
they now prefer to visit those places where all safety measures have been followed and are
hygienic. The selected hotel has maintained its area clean by providing sanitizer to guests along
with keeping their room sanitized after their departure and before arrival. Employees of the
respective hotel also wear mask, gloves and follows all protocols with discipline. The hotel also
provide quality food to its customers along with their overall demands (Moşteanu, Faccia and
Cavaliere, 2020).
Technological factors:
Digitalization has developed a wide range of options for companies to update their technology
and shifting towards digital platform to become more efficient. In context to select hotel, it has
positive impact of technology on itself as it implements various technical equipment such as
robotic room service, online payment transaction, digital supply chain and other (Premier Inn.
2021). These technological advancements help hotel in enhancing its growth as well as brand
image in the market.
Legal factors:
Within hospitality sector of the UK, legal policies and regulations play very important role. The
respective hotel has to follow all food safety laws, privacy law, data security regulation and
many more. In case of selected hotel, it is highly advanced in technology which makes it abide
by with GDPR (Hassan Zadeh and Jeyaraj, 2018). The hotel also has to maintain food and safety
measures in order to avoid any legal issues in future.
Environmental factors:
The environment factor is considered as main component for hospitality sector in the UK.
Government of the country has asked hospitality industry to reduce their impact on nature by
minimising their carbon footprint. The Premier Inn has exclusive greenery and sustainability in
the activities and also taken an initiative to reduce carbon footprint.
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CONCLUSION
Form the above discussion it has been evaluated that for operating business operations
effectively, it is very important for companies to implement right organisational structure.
Managing responsibilities of every employee within an organisation assist it in enhancing their
productivity and also in improving abilities so that desired organisational objectives could be
accomplished. Form applying SWOT analysis companies could determine their areas in which
they are strong and weak which helps them in exploiting opportunities along with mitigating
risks. Through executing PESTLE analysis companies could identify macro environment
components that could impact their business activities. It has been observed in the report that
COVID-19 has majorly impacted both internal and external factors of hospitality industry.
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REFERENCES
Books and Journals
Butler, T. and O’Brien, L., 2019. Understanding RegTech for digital regulatory compliance. In
Disrupting Finance (pp. 85-102). Palgrave Pivot, Cham.
De Stefano, V. and Aloisi, A., 2019. Fundamental labour rights, platform work and human rights
protection of non-standard workers. In Research handbook on labour, business and
human rights law. Edward Elgar Publishing.
Hassan Zadeh, A. and Jeyaraj, A., 2018. Alignment of business and social media strategies:
insights from a text mining analysis. Journal of Business Analytics, 1(2), pp.117-134.
Henley, A., 2018. The exploration of manager’s experiences when leading millennial’s
employees, in a South African fashion retail organisation (Doctoral dissertation, The
IIE).
Miles, I.D., Belousova, V. and Chichkanov, N., 2018. Knowledge intensive business services:
ambiguities and continuities. foresight.
Moşteanu, N.R., Faccia, A. and Cavaliere, L.P.L., 2020, August. Digitalization and green
economy-changes of business perspectives. In Proceedings of the 2020 4th
International Conference on Cloud and Big Data Computing (pp. 108-112).
Teräs, E., 2021. Building digital business capabilities in B2B organisation in Finland.
DUKIĆ, B., and et. al., 2020. STRUCTURAL MODEL OF THE BUSINESS ORGANISATION
FORMS IN THE REPUBLIC OF CROATIA. IMR 2018, p.131.
Ahmad, M.U. and Murray, J., 2019. Understanding the connect between digitalisation,
sustainability and performance of an organisation. International Journal of Business
Excellence, 17(1), pp.83-96.
Zondo, R.W.D., 2021. The Impact of Business Process Re-engineering (BPR) on Labour
Productivity in the Automotive Assembly Organisation in South Africa. Calitatea,
22(183), pp.101-107.
Online
SWOT analysis of Premier Inn. 2018. [Online] Available through:
<https://howandwhat.net/swot-analysis-premier-inn-premier-inn-swot-analysis/>./
Premier Inn. 2021. Online Available through:
<https://www.premierinn.com/gb/en/why/cleanliness.html>
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